Amazon to Sell 4M Kindle Fires For Holiday Quarter: Munster

Amazon (NASDAQ:AMZN) is on track to sell 4 million Kindle
Fire tablets for the fourth quarter, according to a prominent financial analyst who boosted his outlook for the device.

The e-commerce giant began shipping the Fire Nov. 14 to
those who pre-ordered it, and early reviews have been largely mixed.

However, most analysts
believe the custom Android tablet's $199 price point will make it too hard to
ignore among cost-conscious consumers who balked at paying $499 or more for
Apple's (NASDAQ:AAPL) iPad, or other higher-priced Android tablets.

Count Piper Jaffray analyst Gene Munster among those. Munster, who did channel checks and found the device rated highly among consumers, said Amazon will sell some 4 million Fire slates for Q4, much
greater than the 2.5 million he originally estimated for the new gadget.

The
device's strengths includes its close integration with Amazon books, music and
video content, he noted. The Fire also provides a quick on-ramp to the Amazon Prime
membership, which includes free, two-day shipping and free Instant Video flicks
for $79 a year. These factors will help Amazon seize 18 percent of the tablet market this year.

"Overall, we believe the iPad offers a superior user
experience to the Kindle Fire, but note that for $200, the Kindle Fire delivers
as much or more than many other competitors," Munster wrote Nov. 18.

Those
competitors would be other Android tablets, such as the Samsung Galaxy Tab 7.0
Plus, which costs $399, or Research in Motion's Blackberry PlayBook, which was
just sharply discounted to $199 to compete with the Kindle Fire.

Instapaper CEO Marco Arment, whose app is extremely popular on the iPad,
offered a harsher, more detailed critique of the Fire. Munster, too, found
issues with the Fire, noting that app icons either responded too slowly to rapidly
to touch gestures. Moreover, the Fire proved sluggish in handling Flash, he
said.

This will ultimately be a moot point as Adobe and
developers at larger abandons mobile Flash in favor of HTML5.

Global Equities Research analyst Trip Chowdry took a
dimmer view of the Fire. Like Munster and Arment, Chowdry noted that the Fire
lacks the polish and crispness of the iPad, which has sold over 32 million
units to date. However, he also only expects Amazon to sell 1 million Fires for
the quarter, a vastly more conservative number than most industry experts
expect.

Chowdry noted that the Fire lacks many critical sensors,
including a microphone, GPS, gyroscope, magnetometer and a 3G radio.

"Every indication we have as of right now, tells us
that it is very likely that Amazon Fire may end up having the similar fate that
RIMM;s PlayBook had," Chowdry said. "A Lot of expectations, lot of
sell-ins but very weak sell-through."